Import or export transaction: A contractual exchange involving goods or services for money between parties in two countries with different legal systems, currencies, and cultures (source: M. Cellier). It typically involves a formal agreement where goods/services are exchanged for payment, often across borders with varying legal and economic environments.
International trade relationships: The types of connections between trading parties, categorized as:
1. What is an international payment method?
2. Why is 'Cash in Advance' often used in international trade transactions between new trading partners?
3. Which international payment method provides the highest security to the seller but is generally only suitable for small or new trading relationships?
International payment methods — types?
Cash in Advance, L/C, Documentary Collections, Open Account
Cash in Advance — security?
Maximum security for sellers, payment before shipment.
International trade relationships — types?
Affiliated, Unaffiliated known, Unaffiliated unknown.
Cash in Advance — security?
Maximum security for sellers.
Letters of Credit — role?
Guarantees payment upon conditions met.
Documentary Collections — security?
Less secure than L/C, relies on documents.
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